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Revealing find at London School of Economics

On March 8th the Times published a letter from Lord Kalms saying that around 1991 he offered the London School of Economics a grant to set up a Chair of Business Ethics. The faculty rejected the offer as it saw no correlation between ethics and economics. By pure chance a Latvian cleaner at the LSE found what we take as a draft or copy of the rejection letter behind a cupboard. Although we cannot authenticate the letter we take the opportunity of publishing it here today.

Dear Stanley,

Chair of Business Ethics

It really was most kind of you to offer a generous grant to establish a Chair of Business Ethics, and it is with regret that I write to tell you that the faculty could not see a way of proceeding. The thought of turning their back on the vested views we have held for so many years in exchange for the search for fundamental causes and natural law will be too great a sacrifice for us to contemplate.

The problem is that once you start examining right and wrong in the field of economics you open a can of worms that may well undermine the entrenched opinions of the nature of society as we know it. For instance we would have to tell students the truth about how wealth is created and retained by the privileged few, and provide answers to such questions as ‘what does a shareholder do for the dividend received’ or, even worse, ‘how does the Duke of Westminster earn the rent he collects from his inherited estates of Mayfair and Belgravia’. I mean, that really would let the cat out of the bag!

Furthermore there is the subject of landownership and economic rent to consider. It would not be wise to upset the apple cart by teaching that equity does not permit private property in land nor that land value is created by the community and therefore belongs to the community. You can see where I am going with this – the last thing we want is for a bunch of students to get hold of the idea that ‘economic rent’ is not earned increment, but merely pocketed by landowners, when it ought to be collected by society and used to pay for infrastructure and public services. We prefer it for these things to be paid by taxation, so that landowners can charge ever higher rents.

This really could take us in very dangerous directions. We would not be able to ignore that that dreadful book ‘Progress & Poverty’ by the American crank, Henry George! To think Campbell Bannerman, Joseph Chamberlain, Winston Churchill, Lloyd George, Philip Snowden and the rest of them were taken in by his theories. It doesn’t bear thinking about.

Between you and me we have enough trouble confusing students with Marxist and Keynesian economics without getting involved in the obtuse theories of ethics, choices, the lesser of two evils and the rest! Who cares what’s right and wrong as long as the establishment manage to retain the system of privilege, power and hereditary wealth that is the god-given right of the upper class! Our feeling is that the only ethical business practices that we should be concerned with are ones that make the most money and to blazes with corporate social responsibility.

We prefer to keep the line between right and wrong as blurred as possible and to muddle economic terms such as wealth, money, capital, wages and interest. Our students are taught that these terms are all ‘money’ in different forms. As for taxation, we have a strong line in instilling into the students’ mind that taxation should bear most heavily on the working class in order to keep them fully occupied and perpetually on or near the poverty line. Where, after all, would charities be without the poor and needy?

So I hope you can understand that as far as the LSE is concerned there cannot be no connection correlation between ethics and economics, and I am therefore writing to advise you that we must continue to teach economics as if it were an unstable science based on unpredictable market forces outside human control.

I hope you don’t think we are being ungrateful or negative, so we do have a suggestion for you. If you could see your way to offering a grant for setting up a Chair in Land Speculation, Insider Trading, Tax Avoidance and Asset Stripping then we would be more than happy to consider your offer.